Cepsa Auto Team

Japan disaster, bad weather, high gas prices may stall momentum

Christina Rogers / / The Detroit News

Analysts worry that first-quarter momentum in U.S. car and light truck sales is tapering off — a sign the industry’s recovery could be a rougher ride than they’d anticipated.

April started strong, but took a dive as gas prices spiked, storms ravaged the Midwest and South, and parts supply shortages in earthquake-stricken Japan squeezed new car and truck inventories, analysts say.

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Discounts dwindled as dealers ran short of some models last month, forcing buyers to shell out more for new vehicles.

“The industry is facing its first real challenge since the recession, as potential widespread parts shortages have a profound impact on the pace of the recovery,” said John Humphrey, a senior vice president at data-tracking firm J.D. Power and Associates of Westlake Village, Calif.

J.D. Power predicted U.S. new car sales will total 1.2 million for April, up 13 percent from the same month in 2010, but down 7 percent from the previous month. Official sales figures for April, typically a strong selling month, will be announced Tuesday.

Forecasters expect April’s annualized selling rate to come in at about 13 million vehicles — about the same as in March. Sales in 2010 totaled 11.6 million.

More challenges are likely to emerge this summer.

“May and June are traditionally high-volume months,” said Jessica Caldwell, a senior analyst at Santa Monica, Calif.-based Edmunds.com, an online research firm. “And with anticipated supply constraints — especially on fuel-efficient vehicles that have been in higher demand with spiked gas prices — inventories will be exhausted further.”

All three major Japanese automakers, as well as Ford Motor Co. and Chrysler Group LLC, are expected to report increased sales in April over the previous year, but fewer than the month before. Nissan Motor Co. is poised to take the biggest hit, according to Edmunds.com.

Based on preliminary sales data, General Motors Co. could recapture its U.S. sales crown, said Michelle Krebs, Edmunds.com analyst.

The Detroit automaker was edged out by Ford in March, for only the second time since 1998. Ford outsold GM in March by about 5,600 vehicles.

Industrywide, incentive spending was declining in April, compared to both the previous month and April 2010. Those official numbers also will be released Tuesday.

Inventory constraints stemming from the March 11 earthquake in Japan could boost U.S.-based automakers in the months ahead, J.P. Morgan analyst Himanshu Patel wrote in a report released Friday. Japan’s automakers indicated that a full recovery in Japanese production could take months.

Buyers may be willing to pay more for Ford and GM vehicles, especially if small Japanese cars are out of stock, he said.

But Ford, too, is running low on its subcompact Fiesta and compact Focus — a predicament that could cost the Dearborn automaker some market share, Patel said.

GM should also benefit from a shortage in Japanese cars — but not as much as Ford — due to GM’s aging car lineup, Patel said. The Chevrolet Cruze, launched last fall, is the exception, he added.

crogers@detnews.com

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